What Are Common Mistakes Associated With Connecticut Trust Administration?
Andrea decides that she should form a revocable trust to hold some of her assets, including tangible and intangible property. She has amassed several commercial properties and thinks transferring ownership to the trust would make her life easier. She finalizes the trust on her own without consulting an attorney, nominating her best friend as the trustee, and another close friend as the substitute trustee. Andrea never notified either friend of her intentions and passed away suddenly. Now her proposed trustee does not want to handle the affairs or administer the trust and neither does the substitute. How can a hypothetical like this be avoided? What are other mistakes made in Connecticut trust administration that should be prevented?
Not Obtaining Prior Approval from Trustee & Substitute Trustee
When you consider drafting a trust, one of the most important tasks you have as the settlor (creator) of the trust, is choosing a trustee. That trustee can be a relative, friend, or fiduciary (like an attorney or accountant) but simply naming that person as the trustee in trust language and documents is not sufficient. You need to discuss the responsibilities and duties involved with the candidate and their potential substitute, then it is prudent to obtain their consent and approval in writing. It may be wise to schedule a conference or meeting with a potential trustee prior to execution of trust documents. The chosen trustee may make complete sense to the settlor, but it the trustee also cannot be forced to perform duties. Adequate planning will provide for that contingency.
Failing to Transfer Real Property with a Deed and Record Properly
Our hypothetical discussed the transfer of real property to a revocable trust. The transfer of real property must be properly recorded with town land records. This is usually the town in which the real property is held. In Connecticut, the town clerk’s office maintains all land records. A deed needs to be drafted and executed properly to be valid. Also, applicable recording fees must be paid. There may also be tax implications associated with the transfer of real property, especially if it is used for investment or income purposes. If you are considering the transfer of real property to a trust, talk to Attorney Brian S. Karpe first.
Contact Connecticut Trust Administration Lawyer Brian S. Karpe
Deciding to form a trust is a major decision. Choosing the trust that is right for your needs is one task, but administering the task is another entirely. Dedicated Canton estate planning attorney Brian S. Karpe is prepared to help you today. With an LLM advanced law degree in estate planning, he focuses on assisting clients with planning and trust administration needs. Call today to schedule a consultation and discuss your options.